Easing curbs, new stores lift Wilcon Depot profits in H1

MANILA, Philippines — Wilcon Depot Inc. reported higher earnings in the first half, thanks to easing pandemic restrictions and contributions from its newly-opened stores.

The listed home improvement and finishing construction supplies retailer netted P1.86 billion in the first 6 months of the year, 49% higher than the comparable period last year, according to a stock exchange filing on Thursday. In the second quarter alone, net income grew 56.4% on-year to P1 billion.

Explaining its financial results, Wilcon said both net and gross profit margin grew during the period, although earnings would have been higher if not for rising operating expenses.

Figures showed net sales in the first half amounted to P15.94 billion, up 18.7% year-on-year on the back of 11.8% annual growth in comparable sales. The company said its three new stores in Luzon started pitching in some amount to the profit.

Excluding necessary deductions, Wilcon said its gross profit grew at an annualized rate of 25.3% in the January-June period to P6.16 billion, after in-house and exclusive brands’ contribution increased to 51.1% from 49.3% previously.

But the growth was offset by high operating expenses, which jumped 13.7% year-on-year to P3.85 billion in the first half. The company attributed the uptick to “expansion-related expenses, higher volume of business and inflation.” Capital expenditure for the half amounted to P1.33 billion. 

Still, Lorraine Belo-Cincochan, company president and CEO, believes that Wilcon is “on track” to meet its expansion target of opening eight new depots this year.

“This July, we opened one depot in Ilocos Sur and one Home Essentials in Tagaytay. We will be opening four more depots this second half,” Belo-Cincochan said in a statement.

“With the improving performance of stores in areas that were more frequently disrupted by mobility restrictions last year, we expect our net sales to grow by at least high teens and our comparable sales by high-single digit to low teens for the full year 2022,” she added.

As of 12:27 p.m. Thursday, shares in Wilcon were trading up 2.11%. — Ian Nicolas Cigaral